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Low sales force employee cuts

Feb. 16, 2001

Students among those losing their retail positions

By TYLER EMLER

Reporter

Students who used to shop at retail stores such as Structure and Montgomery Wards might have come back from Christmas to a shocking discovery -- the stores are now gone. Structure, which suffered from inadequate sales, and Montgomery Wards, which has closed all of its stores nationwide, are victims of a national trend of slumping retail sales.

The national retail slump, caused by a drop in consumer spending, has forced many stores to limit the number of employees they carry.

'A lot of these stores base the number of people that they have on staff [on] the volume [of sales],' said Pamela Patrick, assistant manager of American Eagle Outfitters in the Richland Mall. 'If we're not doing the volume, then [managers] kind of put a stop on hiring.'

Patrick said they cut their number of employees from five to two because of a lack of customers.

Sonia Hassler, the store manager at Bealls Department Store in the mall, said, 'your payroll is your biggest controllable expense in a retail store. You can have 50 [employees] and your store is going to look great, but you're going to have a high payroll cost. So you have to have an associate ratio to your customers.'

Hassler said Bealls' owner, State Stores Inc., has closed 300 stores, one of which is in Bellmead, because of 'economical problems with the trends' after 'filing a chapter 11 bankruptcy.'

She said there were now only 330 stores left.

Jack Stewart, president and CEO of the Greater Waco Chamber of Commerce, said the low retail sales are not abnormal and that the sales in Waco are currently stable. He said the first few months of the year generally have low consumer spending.

Stewart said the reason stores like Montgomery Wards are having problems is because they aren't able to stay competitive.

'The good stores survive, and the bad stores won't,' he said.

Some major department stores, such as Sears, have not experienced any drops in sales.

Gary Self, the store manager of the Sears in Waco, said his chain actually experienced an increase in sales over the last few months.

'Nationally we were up a little over 3 percent. We had a nice increase [in sales] in January,' Self said.

Self said February sales were slow but that it was because of cooler weather rather than national trends.

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